Creditor

Date: Fri, 04/18/2008 - 10:20

Submitted by anonymous
on Fri, 04/18/2008 - 10:20

Posts: 202330 Credits: [Donate]

Total Replies: 1

Hi, I found an entry on my credit report for an account held by a credit agency amounting to more than $11,000. I traced it back, and this was a debt that was purchased from the original lender, a credit card with a balance of $4500. Is it legal to keep charging interest after the account is long closed? I'd like to pay it, but not twice the amount originally owed. Thanks for any advice.

The lender can continue to charge interest at the agreed-upon ra

The lender can continue to charge interest at the agreed-upon rate for as long as they own it -- even if it has been charged off.

Once it is sold, it depends on state/licensing laws. Most states require a company to be licensed if they are charging any interest in excess of the statutory rate. For example, in IL that statutory rate is 9% -- if a bad debt buyer buys my 18% credit card account, then they would need to be licensed if they want to keep charging the interest on that account.

Most bad debt buyers are not licensed to charge interest. You should find out what the balance was when the OC sold it, and if the CA is trying to tack on interest, then demand to see their sales finance license.

lrhall41

Submitted by DebtCruncher on Fri, 04/18/2008 - 17:36

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